Hyderabad, India. Hyundai Motor Company, South Korean automobile giant, treated India as a prime growth market for its global manufacturing business. Ahead of its own launch of Indian IPO, it now announced to make India one of the largest global hubs for its manufacturing business. This strategic move proves that India is increasingly getting important in the global automotive industry.
In an event at a Mumbai press event, Hyundai Motor India Managing Director Unsoo Kim described the country as the most exciting market in the world. Hyundai finds the Indian automotive market has immense growth potential in a country where the demand has been picking up lately, thanks to the growth in the middle class and rising infrastructure. India is now one of the most expensive car markets in the world, and Hyundai has been prevalent in India for decades.
The strategy appears to be in line with the emerging trend of global carmakers diversifying and spreading their presence in a variety of growing markets. Hyundai is indeed focused on not only increasing sales but also enhancing its production capabilities in India to convert the country into a global manufacturing hub. Cars are aimed to be produced in India, both for consumption by the domestic markets and for exports to other international markets.
The Biggest IPO in India’s History
Going by these manufacturing plans, Hyundai is all set to launch India’s largest initial public offering. South Korean parent will sell up to 17.5% in its Indian subsidiary raising about $3 billion in the deal. At the high end of the price band, the IPO will value Hyundai Motor India at about $19 billion, and that is a gargantuan amount in India’s capital market history.
Coming to the public is the long-term strategy of Hyundai to further set up its roots in the Indian market and also raise its capital for the future expansion and innovations. IPO would provide a further strengthening to the presence of the company in India, by using local investments and targeting new growth opportunities.
Hyundai’s Manufacturing Expansion Plans
The initiative towards India as a global manufacturing hub will remain an important aspect in the company’s broad strategy. Hyundai already has had an enormous manufacturing presence in the country, with two big plants in Chennai as well, manufacturing several models for both the local market and for exports to more than 88 countries.
With an increased manufacturing capacity, Hyundai aims to cater to increasing domestic demand while further serving as a significant export production base. It would consequently strengthen the competitive edge of the company by bringing down the cost of production as well as benefitting from India’s skilled workforce.
Role of Electric Vehicles in Hyundai’s India Strategy
Hyundai’s growth plan for India also features the electric vehicle market. India has been paying attention to greener, more environment-friendly mobility solutions, and Hyundai has been one of the earliest players in bringing electric vehicles to India. The company does see India as an important market for the ramping up of electric car production in this country.
The proceeds from the IPO will be invested in new technologies and infrastructure, comprising electric mobility and digitalization, to maintain a leading position in the rapidly transforming automotive industry.
Conclusion: India- The Future Growth Engine for Hyundai
Hyundai Motor Company is intensifying its commitment in its effort to make India a global manufacturing powerhouse as it prepares to take the landmark Initial Public Offer in India. With India’s growing market and aggressive plans by Hyundai to scale up the manufacturing and investment into electric vehicles, the company seems well-placed to take good advantage of future prospects.
With the valuation of $19 billion and the trend of its increasing demand in the marketplace, Hyundai’s story in India is only going to get underway. When this IPO takes place, it will be more than a financial landmark; it will mark Hyundai’s arrival as the Indian automobile market leader.
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